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Germany warns Greeks it won't be blackmailed in election

Kermit.de.frog

Also it seems they are not that bothered anymore if Greece falls out of the euro.

http://www.irishtimes.com/business/economy/germany-will-not-be-blackmailed-into-renegotiating-greek-rescue-1.2055194

The Greeks want to elect a party opposed to the whole bailout on the 25th. But there will be no renegotiation and Germany is not in the mood to tolerate blackmail from a people and it's government it believes over decades was feckless in how it ran it's affairs. And there will be no more money for them.

I hope the left parties do win in Greece later in the month so other PIIGS like Ireland can see the consequences of electing people with no real ideas or alternatives.

The 25th of January could be the start of the disintegration of the eurozone. And once one is forced out the market targets the next weakest link until they are kicked out because no one will believe they can stay.

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KomradeBishop

Boskowski wrote: »

I've been reading interesting essays claiming whether its more austerity or more credit doesn't matter. Both measures will only kick the real issue down the road. Capitalism is as failed a system as the other one and all this is just a symptom of the beginning of end game. 25 years max they say.

The ultimate problem apparently is - and I must say that sounds quite plausible - that you can't keep increasing productivity infinitely. At some stage you'll only need a few people to produce all the stuff but what are all the other guys going to do? Are they all going to be hairdressers and yoga trainers or shift virtual nothings around like they do on London all day long? And more importantly if they have nothing to do and consequently make no money, who is buying all the stuff then?

What do you say to that btw? Just another lefty loony crazy theory?

There's a good article here, from an ex-NASA physicist, on how current economic system depends upon infinite/neverending growth, and how this is physically impossible to sustain, due to the laws of thermodynamics:
http://physics.ucsd.edu/do-the-math/2012/04/economist-meets-physicist/

Summary of main notable point: Economic growth is tied to growth in energy production (explained in article - even just a tiny amount of energy growth, needed to sustain economic growth, is a problem), and by the laws of thermodynamics this increase in energy production dumps waste-heat into the atmosphere.

So, to illustrate how this is unsustainable: At our current rate of exponential economic growth, the surface of the earth would reach 100°C within 400 years; obviously this is completely unsustainable, and the current economic system would collapse long before then.

Idbatterim

The Greeks want to elect a party opposed to the whole bailout on the 25th. But there will be no renegotiation and Germany is not in the mood to tolerate blackmail from a people and it's government it believes over decades was feckless in how it ran it's affairs. And there will be no more money for them.

I hope the left parties do win in Greece later in the month so other PIIGS like Ireland can see the consequences of electing people with no real ideas or alternatives.

I was delighted when I came across an article confirming the same several days ago. The way Greece ran their country made even our lot look world class, they voted in reckless, feckless parties and now want to do so again, at some stage, there has to be consequences...

some of the stuff I read on Greece, would even make Irish jaws hit the floor, the Island of the blind, the work practices, Sachs cooking the books...

Boskowski

And of course there is the dilemma of infinite growth in a closed system with finite resources. Of course we can spread to other planets of we keep ahead but this is where Agent Smith's theory comes into play.

BoatMad

KomradeBishop wrote: »

Using their new currency.

You've got the causation wrong there: It was foreign denominated debts and massive industrial output collapse, that caused the Weimar hyperinflation, and then triggered the money printing (which further exacerbated the hyperinflation).

However, Greece will still likely have significantly bad inflation if they opt for 'New Drachma' - because their exports will likely collapse if they are economically sanctioned for defaulting, and combined with the devaluation, will increase the cost of imports; they'll have very high inflation, but so long as they avoid foreign-denominated debt, they shouldn't risk hyperinflation.

It'd be part of the huge short/medium-term cost/destruction, of achieving long-term economic recovery - they won't get any recovery staying in Europe, on current terms (though the best of all worlds, would be Germany/EU softening of terms, to allow them a recovery while staying in the Euro).

Sorry you are simply incorrect. ( and I quoted in another post Keynes statement to that effect). Germany and several belligerent nations decided that dropping the gold standard and expanding the money supply was an acceptable way to play its debts

This is exactly like what Ireland did with the promissory note swap, except we contained it ( well the ECB did) and we got away with it

I m not arguing about WHY Germany ended up with some many creditors, war si a notoriously expensive undertaking and led to the introduction of income tax in Britian ( crimea war) and France ( a victor) in ww1.

what I was saying is that a country cannot use the existence of a fiat currency to "buy" itself out of trouble, where that trouble is deep and systemic. Because once trust is lost m the value plummets and inflation soars wiping out wealth.

However, Greece will still likely have significantly bad inflation if they opt for 'New Drachma' - because their exports will likely collapse if they are economically sanctioned for defaulting, and combined with the devaluation, will increase the cost of imports; they'll have very high inflation, but so long as they avoid foreign-denominated debt, they shouldn't risk hyperinflation.

Firstly part of the problem is that Greece is not a exporting nation, it has a poor means of earning foreign currency. secondly their default would bankrupt their banks, which would require the greeks to refinance from their own resources. Thirdly ordinary creditors ( the breeks run a substantial budget deficit) would still demand payment, defaulting on them would bankrupt further sections of the greek economy.

SO faced with an inability to raise external finance , the greeks would be forced to engagein massive money printing exercise, causing further inflation ( the greeks import lots of things), causing a further devaluing of their new currency, which causes further problems for any new external debt the greeks have run up, possibly causing a new run of default.

The greeks cannot , short of closing their borders and living on "feta", avoid foreign denominated debt.

No country is an island financially

BoatMad

Boskowski wrote: »

And of course there is the dilemma of infinite growth in a closed system with finite resources. Of course we can spread to other planets of we keep ahead but this is where Agent Smith's theory comes into play.

we can produce more and more intangible valuations of wealth, including non physical products ( information , etc) .

I see no worries man is a creative creature.

dissed doc

BoatMad wrote: »

No country is an island financially

Island is an island literally though. I think different cultures and economies are based on the make up of the people in it at a particular time. Greece is better at tourism. Trying to make a tourist driven economy into an export one to China (i.e., the kind that suits the fiat currency system of debt) is about as useful as trying to to set up new coal mines in the Ruhrgebiet or start an auto industry in the North of England.

The euro is a political tool and has zero to do with the economic need. Any country could leave and do just fine, the only downside is the loss of the political "economy". The actual economy - how it functions and what makes money and what doesn't - is completely separate. When one messes up (i.e., the politics) they come looking to the actual economy to be bailed out.

Boskowski

BoatMad wrote: »

we can produce more and more intangible valuations of wealth, including non physical products ( information , etc) .

I see no worries man is a creative creature.

I do not doubt that, what I'm worried about is the 'collateral damage'.

BoatMad

dissed doc wrote: »

.

The euro is a political tool and has zero to do with the economic need. Any country could leave and do just fine, the only downside is the loss of the political "economy". The actual economy - how it functions and what makes money and what doesn't - is completely separate. When one messes up (i.e., the politics) they come looking to the actual economy to be bailed out.

The genesis of the Euro is complex, partially it was a way of progressing the Union into full monetary and political union and I think that soon that stark decision will be evident. ( we have actually taken the decision to progress to Union).

The Germans, in their fear of currency devaluation etc, strangled the Euro at its creation, in essence creating kind of Gold standard. ( i.e. limiting its creation), This led to many issues in the recent crash and is directly responsible for our slow recovery as a zone.

One can argue where the " real " and imaginary economy exist. Both are symbiotic and co-dependant. in reality the real economy depends on the imaginary one just as much as the other way round.

To say the Euro is a political tool is to misplace its purpose. Its creation might be described as political ( and its adoption) , but in its use its merely a monetary policy instrument.

As to whether a country can survive or prosper on leaving the euro, is a hypothetical debate, I suspect it would have a lot to do with the fundamental health of the underlying country. Germany leaving the Euro is one thing, Greece is another entirely.

twinytwo

Its hilarious when you think that all this is brought about by a bunch of ones and zeros that are worth nothing in reality.

BoatMad

twinytwo wrote: »

Its hilarious when you think that all this is brought about by a bunch of ones and zeros that are worth nothing in reality.

yes the magic of the modern money supply, Thank two world wars for it

Magico Gonzalez

"The Germans, in their fear of currency devaluation etc, strangled the Euro at its creation, in essence creating kind of Gold standard. ( i.e. limiting its creation), This led to many issues in the recent crash and is directly responsible for our slow recovery as a zone"

How so? I am not disagreeing, I am interested to understand what the Germans did to strangle the Euro.

KomradeBishop

BoatMad wrote: »

I am afraid you are fundamentally mistaken in your understanding

Keynes in his book pointed out the mistakes that led Germany to experience the problems of currency devaluation.
I quote from a review of his book

Keynes explicitly pointed out the relationship between governments printing money and inflation.

"

I quoted him in that he is widely accepted as having correctly forewarned leaders of the issues surrounding the Versailes agreement and its effect on Germany and furthermore he explicitly warned of what Germany then did.

You have provided no sources to back your arguments, what I was dealing with was a thread post that merely claimed that Greece could print it way out of trouble, The Weimar experience, albeit more severe , clearly points out the fallacy of that thinking,

All foreign debt is demented in the currency of the lender ( which perhaps the notable exceptions of two or three " reserve " currencies). Germany was no different, it had both huge internal and huge external creditors after the war. Unlike Britian after the Crimean war or France after the First war, it decided, against explicit advise, to fund the repayments by quantitative easing, i.e. printing money. Therin lies the risks of a paper currency.

Taxes have nothing particular to do with currency. ,especially fiat currency. a fiat currency means that a state issue a "promise" that the value stated on the paper currency will be honoured. Promise = faith. Previous to that , a currency was backed by gold reserves , in that cases the paper money promise was backed by bullion in a vault. However the ability to manage credit and raise money in a fixed money supply system causes countries to abandon the gold standard.

lets leave this there, if you want to argue provide sources to back what you say.

The book was written before the hyperinflation. You're talking about something different. Yes, Germany had high inflation beforehand, but what triggered the hyperinflation was 1: Foreign-denominated debt, and 2: The industrial destruction/confiscation imposed on Germany primarily by France, after they defaulted:
http://bilbo.economicoutlook.net/blog/?p=3773

We're talking about two things really: You're talking about the high inflation period (not hyperinflation), I'm talking about the hyperinflation and how it was caused.

Nobody claimed Greece can print their way out of trouble.

Taxes have everything to do with the backing of a currency: If the government says the only way you can pay taxes, is in Euro's, then you must get your hands on Euro's to fulfil tax obligations - this underpins demand for a currency.

As Alfred Mitchell-Innes wrote:

From what I have said in those two articles follows the important principle that, a government issue of money must be met by a corresponding tax. It is the tax which imparts to the obligation its "value." A dollar of money is a dollar, not because of the material of which is made, but because of the dollar of tax which is imposed to redeem it.

https://www.community-exchange.org/docs/The%20Credit%20Theoriy%20of%20Money.htm

It's the basis of the credit theory of money.

KomradeBishop

BoatMad wrote: »

Sorry you are simply incorrect. ( and I quoted in another post Keynes statement to that effect). Germany and several belligerent nations decided that dropping the gold standard and expanding the money supply was an acceptable way to play its debts

This is exactly like what Ireland did with the promissory note swap, except we contained it ( well the ECB did) and we got away with it

I m not arguing about WHY Germany ended up with some many creditors, war si a notoriously expensive undertaking and led to the introduction of income tax in Britian ( crimea war) and France ( a victor) in ww1.

what I was saying is that a country cannot use the existence of a fiat currency to "buy" itself out of trouble, where that trouble is deep and systemic. Because once trust is lost m the value plummets and inflation soars wiping out wealth.

Your cited a book written before the hyperinflation even happened, so you don't have any citations on the hyperinflation.

I didn't claim anyone can buy their way out of trouble - don't know where you're getting that? All I'm claiming, is that the causation of hyperinflation in Weimar Germany's case, started with reparations in a foreign currency and industrial destruction, and the actual money printing that cyclically-worsened the hyperinflation, came from this (note: high inflation is not the same as hyperinflation - it has to be extremely high and cyclical to be hyperinflation, which is why the high-inflation before 1921 is not hyperinflation).

I think we are talking about two different things here, and confusing them with one another.

BoatMad wrote:

Firstly part of the problem is that Greece is not a exporting nation, it has a poor means of earning foreign currency. secondly their default would bankrupt their banks, which would require the greeks to refinance from their own resources. Thirdly ordinary creditors ( the breeks run a substantial budget deficit) would still demand payment, defaulting on them would bankrupt further sections of the greek economy.

SO faced with an inability to raise external finance , the greeks would be forced to engagein massive money printing exercise, causing further inflation ( the greeks import lots of things), causing a further devaluing of their new currency, which causes further problems for any new external debt the greeks have run up, possibly causing a new run of default.

The greeks cannot , short of closing their borders and living on "feta", avoid foreign denominated debt.

No country is an island financially

Some amount of foreign debt isn't a bad thing, it's when you have a near-unsustainable amount of it, that there's a problem - as Greece would if they exit the Euro without redenominating their huge debts.

washman3

Kermit.de.frog wrote: »

Also it seems they are not that bothered anymore if Greece falls out of the euro.

http://www.irishtimes.com/business/economy/germany-will-not-be-blackmailed-into-renegotiating-greek-rescue-1.2055194

The Greeks want to elect a party opposed to the whole bailout on the 25th. But there will be no renegotiation and Germany is not in the mood to tolerate blackmail from a people and it's government it believes over decades was feckless in how it ran it's affairs. And there will be no more money for them.

I hope the left parties do win in Greece later in the month so other PIIGS like Ireland can see the consequences of electing people with no real ideas or alternatives.

The 25th of January could be the start of the disintegration of the eurozone. And once one is forced out the market targets the next weakest link until they are kicked out because no one will believe they can stay.

PARTY POLITICAL BROADCAST ON BEHALF OF FINE GAEL,LABOUR AND FIANNA FAIL....;)

DeJa VooDoo

bear1 wrote: »

They already own Europe... no war needed.

Merkel has what the Nazi's couldn't get.
Total control.

washman3

SEPT 23 1989 wrote: »

who helped them cook the books?

+1...

OP's 'concerns' answered in a nutshell.............

BoatMad

KomradeBishop wrote: »

The book was written before the hyperinflation. You're talking about something different. Yes, Germany had high inflation beforehand, but what triggered the hyperinflation was 1: Foreign-denominated debt, and 2: The industrial destruction/confiscation imposed on Germany primarily by France, after they defaulted:
http://bilbo.economicoutlook.net/blog/?p=3773

We're talking about two things really: You're talking about the high inflation period (not hyperinflation), I'm talking about the hyperinflation and how it was caused.

Nobody claimed Greece can print their way out of trouble.

yes it was claimed that with its new currency it had no need for foreign currency.

Keynes predicated the period of hyper inflation, which was a direct result go the period of high inflation

Taxes have everything to do with the backing of a currency: If the government says the only way you can pay taxes, is in Euro's, then you must get your hands on Euro's to fulfil tax obligations - this underpins demand for a currency.

Innes theory was a way ( in 1916) of explaining the difference between a fiat currency and a gold standard one ( or metallic theory of currency) mainly to an audience that believed gold was the only currency.

His concept of currency and tax, relates to government debt, i.e. if the gov gives you paper to pay a debt then it must collect that via tax. This all repeated the dismantling of bretton woods and free floating currencies, where the tax to debt link is broken ( its called deficit budgeting)

Thats not the point in relation monetary policy and fiat currencies. what I am discussing is the expansion and contraction of the money supply in a flat currency. in that regard the value of the currency ( to outsiders ) is based on the faith that when they redeem it , it will discharge its debts ( this is exactly what Innes was also stating),

Innes didn't say that all money is based on taxation ,

KomradeBishop

BoatMad wrote: »

...
To say the Euro is a political tool is to misplace its purpose. Its creation might be described as political ( and its adoption) , but in its use its merely a monetary policy instrument.

It's not politically neutral though - how the Euro is managed, puts limits on the fiscal policy (government spending) of EU countries, and thus is a political tool that can be used to limit government spending policy (or to expand government spending, given the right political environment).

How a currency is managed, inherently affects the politics of the country/countries using that currency; in the UK, there are growing calls (such as from the leading editor of the Financial Times, Martin Wolf), for the UK central bank to begin either providing created money directly to the people, or to the government, to avoid deflation:

Pushing his analysis to its logical conclusion, he argues that the only way to deal with today's underlying problems--a fragile financial system and a secular weakness in demand--may be to move away from bank-based credit altogether and rely on permanent budget deficits financed by central banks.

http://www.businessinsider.com/review-of-martin-wolfs-new-book-2014-9?IR=T

That makes management of a currency, an enormously important issue that inherently affects the politics of countries operating under that currency. An issue that is hardly ever talked about though, even though it's more politically important (in my view) than just about any other topic.

BoatMad

DeJa VooDoo wrote: »

Merkel has what the Nazi's couldn't get.
Total control.

not in the slightest, that only look like that cause they thump their chest a lot, Their economy is as fragile as any and they will be the one looking few a few quid soon.

mad muffin

Slot Machine wrote: »

The lizard people?

All hail!

BoatMad

KomradeBishop wrote: »

It's not politically neutral though - how the Euro is managed, puts limits on the fiscal policy (government spending) of EU countries, and thus is a political tool that can be used to limit government spending policy (or to expand government spending, given the right political environment).

That makes management of a currency, an enormously important issue that inherently affects the politics of countries operating under that currency. An issue that is hardly ever talked about though, even though it's more politically important (in my view) than just about any other topic.

This is somewhat the reverse, The decisions a gov makes about its fiscal policy and the money supply , affect the currency. that was the whole point of the post war movement to free floating fiat currencies. sovereign governments are free to set monetary policy but that has implications for the currency and inflation etc.

In the eurozone, that ability is not under the control of any one government, its a shared model . Its not correct to say that the euro is used to " control" governments, its governments collectively controlling themselves by excessing prudent monetary policy.

DeJa VooDoo

BoatMad wrote: »

not in the slightest, that only look like that cause they thump their chest a lot, Their economy is as fragile as any and they will be the one looking few a few quid soon.

You'd think they'd understand that by forcing governments to impoverish their own people that Germany's own economy will suffer greatly from reduced exports.

KomradeBishop

BoatMad wrote: »

yes it was claimed that with its new currency it had no need for foreign currency.

Keynes predicated the period of hyper inflation, which was a direct result go the period of high inflation

It's established that high inflation happened in the years before the hyperinflation, sure, but not that the hyperinflation was caused by that - the triggering events were the reparations and industrial destruction (and subsequent loss of economic output), as cited.

BoatMad wrote: »

Innes theory was a way ( in 1916) of explaining the difference between a fiat currency and a gold standard one ( or metallic theory of currency) mainly to an audience that believed gold was the only currency.

His concept of currency and tax, relates to government debt, i.e. if the gov gives you paper to pay a debt then it must collect that via tax. This all repeated the dismantling of bretton woods and free floating currencies, where the tax to debt link is broken ( its called deficit budgeting)

Thats not the point in relation monetary policy and fiat currencies. what I am discussing is the expansion and contraction of the money supply in a flat currency. in that regard the value of the currency ( to outsiders ) is based on the faith that when they redeem it , it will discharge its debts ( this is exactly what Innes was also stating),

Innes didn't say that all money is based on taxation ,

Okey, I think we might both be getting the wrong impression of what we're replying to again so

Innes didn't say all money is based on taxation, but he did say that demand for fiat currency (and thus its value via supply and demand), is grounded in taxes; this is as true today as it was then.

SpaceTime

The vibe coming from Germany at the moment is more like:

"OK, if you want to go - Go! Just don't let the door hit you on the rear on the way out. We do not want to have to get it repolished!"

KomradeBishop

BoatMad wrote: »

This is somewhat the reverse, The decisions a gov makes about its fiscal policy and the money supply , affect the currency. that was the whole point of the post war movement to free floating fiat currencies. sovereign governments are free to set monetary policy but that has implications for the currency and inflation etc.

They affect each other - monetary/fiscal policy and the currency, are all intertwined. None of it is politically neutral, i.e. each part affects the policies of countries operating under the currency.

BoatMad wrote: »

In the eurozone, that ability is not under the control of any one government, its a shared model . Its not correct to say that the euro is used to " control" governments, its governments collectively controlling themselves by excessing prudent monetary policy.

Governments don't have control over EU monetary policy anymore, because it just takes one powerful country - like Germany - to exercise a veto, to make economic management of the Euro dysfunctional.

How the Euro is managed, does control whether or not a country is able to engage in deficit spending and avoid deflation - and it's easy for e.g. Germany to veto any policies that might lead to a recovery.

So, how the Euro is managed, effectively dictates a large amount of government policy EU-wide.

Nobody other than Germany really has a say, right now - their ability to effectively 'veto', gives them huge control.

BoatMad

KomradeBishop wrote: »

It's established that high inflation happened in the years before the hyperinflation, sure, but not that the hyperinflation was caused by that - the triggering events were the reparations and industrial destruction (and subsequent loss of economic output), as cited.

Okey, I think we might both be getting the wrong impression of what we're replying to again so

Innes didn't say all money is based on taxation, but he did say that demand for fiat currency (and thus its value via supply and demand), is grounded in taxes; this is as true today as it was then.

no he didn't, the credit theory of money is an explanation that the value of money is not based on gold, but its ability to discharge a debt. in essence "modern " money ( in 1916) was based on that fact.

What he said in relation to taxes, was in relation to government debt. and he made the point that greater government spending shouldn't be seen as good as it led to greater taxation. that for every piece of paper the government gave you ( to discharge a gov debt) it had to recover that in tax. of course this was long before the fashionable idea of continuous budget deficits was common. ( two world wars will do that). Today governments readily give out more paper then tax collected !!!

but he didn't say the principle behind a currency in general is taxation.

KomradeBishop

BoatMad wrote: »

no he didn't, the credit theory of money is an explanation that the value of money is not based on gold, but its ability to discharge a debt. in essence "modern " money ( in 1916) was based on that fact.

What he said in relation to taxes, was in relation to government debt. and he made the point that greater government spending shouldn't be seen as good as it led to greater taxation.

but he didn't say the principle behind a currency in general is taxation.

He states money itself is effectively a government IOU, i.e. debt - it's not about public debt.

I didn't say the principle behind money, was taxation, either - I pointed out that the taxation underpins demand for a currency (it doesn't have to be this way, but that's currently how it is for modern fiat currencies).

Kermit.de.frog

washman3 wrote: »

PARTY POLITICAL BROADCAST ON BEHALF OF FINE GAEL,LABOUR AND FIANNA FAIL....;)

Well if our spoofers on the left could tell us where the magic money tree is planted maybe it wouldn't seem like that. But they can't.

Richard Boyd Barrett is like the Duke of York leading the peasants up the hill over water charges. The problems happen when they reach the top and he is no where to be seen.

Their arguments are irrational and at best infantile and SF is not far away from that either.

BoatMad

KomradeBishop wrote: »

They affect each other - monetary/fiscal policy and the currency, are all intertwined. None of it is politically neutral, i.e. each part affects the policies of countries operating under the currency.

Governments don't have control over EU monetary policy anymore, because it just takes one powerful country - like Germany - to exercise a veto, to make economic management of the Euro dysfunctional.

How the Euro is managed, does control whether or not a country is able to engage in deficit spending and avoid deflation - and it's easy for e.g. Germany to veto any policies that might lead to a recovery.

So, how the Euro is managed, effectively dictates a large amount of government policy EU-wide.

Nobody other than Germany really has a say, right now - their ability to effectively 'veto', gives them huge control.

I think you are ascribing them too much power. Germany hold no " veto", many of the ECB policies are at the behest of other countries, france, italy , spain etc.

In fact Germany and its public are so concerned about the direction of the ECB , there is a sizeable opinion germany should abandon the ECB and the euro.

whether deficit spending leads to a recovery is a moot point.

The desire to maintain a strong euro, easily rationalise as its a young currency, tends to drive ECB policy. Also baked in Germany obsession with anti-inflation also has skewed ECB policy.

However the real issue is that the ECB is not a proper bank of last resort and that has weakened the eurozones ability to handle crisis.

KomradeBishop

BoatMad wrote: »

I think you are ascribing them too much power. Germany hold no " veto", many of the ECB policies are at the behest of other countries, france, italy , spain etc.

In fact Germany and its public are so concerned about the direction of the ECB , there is a sizeable opinion germany should abandon the ECB and the euro.

whether deficit spending leads to a recovery is a moot point.

The desire to maintain a strong euro, easily rationalise as its a young currency, tends to drive ECB policy. Also baked in Germany obsession with anti-inflation also has skewed ECB policy.

However the real issue is that the ECB is not a proper bank of last resort and that has weakened the eurozones ability to handle crisis.

Germany effectively hold a veto over any use of the ECB to promote deficit spending - politically, that's a no-go, because Germany will just say no.

Deficit spending leading to recovery is central to the entire economic/political crisis in Europe - that a currency can be managed, and directed towards promoting fiscal-policy/deficit-spending, which would lead to a recovery, is exactly why management of the currency (and monetary policy in general) is not politically neutral.